by Claude Chendjou
PARIS (Reuters) – European stock markets ended with weak variations on Monday and Wall Street also moved without much change at mid-session, as investors awaited the US inflation figures expected on Wednesday.
In Paris, the CAC 40 ended with a gain of 0.45% to 7,143.69 points. Britain’s Footsie advanced 0.23% and Germany’s Dax gained 0.45%.
The EuroStoxx 50 index rose 0.47%, the FTSEurofirst 300 0.14% and the Stoxx 600 0.18%.
At the close in Europe, the Dow Jones advanced 0.42%, the Standard & Poor’s 500 was stable, while the Nasdaq fell 0.22%.
In the absence of major economic indicators, the day’s session was marked by a certain wait-and-see attitude when the final German inflation figures for the month of June will be published on Tuesday and especially on Wednesday the monthly consumer prices in the United States.
“We are in an ‘information vacuum’ until Wednesday,” said Thomas Hayes, chairman of Great Hill Capital.
Inflation data could provide clues on the path of interest rates, with further tightening by major central banks in Europe and the US expected this month, while uncertainty remains for the end of the year.
Investors also opted for caution ahead of the start of the US corporate earnings season for the second quarter which begins on Friday. Citigroup lowered its rating on U.S. stocks from “overweight” to “neutral” on Monday, citing the threat of a recession and slowing business growth.
Refinitiv data shows earnings for S&P-500 companies are expected to fall 5.7% in the second quarter.
VALUES
On the pan-European Stoxx 600, variations were small among the major sectors of the rating, with tourism and transport (+1.33%) showing the strongest progress, while “utilities” (-0.69%) showed the largest decline.
The oil and gas compartment (+0.35%) benefited from the hope of economic stimulus measures in China after indicators showing weak demand.
In individual values, Bayer gained 1.59% on news that the German group could split its subsidiary CropScience.
Scout24 fell 3.16%, penalized by the lowering of UBS’s recommendation to “sell”.
CHANGES
The dollar, which lost 0.87% on Friday after the US jobs report, fell again on Monday, by 0.15% against a basket of international currencies, as traders bet on the imminent end of the monetary tightening cycle of the fed.
The euro is trading at 1.0989 dollars (+0.2%).
The pound, which touched a 15-month high of 1.2850 on Friday on expectations of a Bank of England (BoE) rate hike to 6.5% at the start of next year, gives way a little ground, at 1.283 dollars (-0.05%).
RATE
Bond yields in the eurozone have caught their breath after last week’s sharp rise. The ten-year German Bund rate, which rose 24 basis points last week, ended almost flat on Monday at 2.64%.
That of US Treasury bonds of the same maturity yielded around two basis points, to 4.0117%.
OIL
Oil prices, which gained more than 4% last week, are stable, with investors torn between weak Chinese indicators and the prospect of lower Russian and Saudi production in August.
Brent nibbles 0.01% to 78.47 dollars a barrel and American light crude (West Texas Intermediate, WTI) yields 0.09% to 73.79 dollars.
(Written by Claude Chendjou, edited by Bertrand Boucey)
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